A healthtech startup with no revenue at 18 months looks like a failure on most scorecards, yet it is often right on track. Regulatory review for a routine medical device submission averages 163 days, complex approvals passed 1,000 days in 2023, and the product cannot ship until that clears.
Margins follow a different curve as well. Healthtech starts near 25% and climbs above 60% at scale, so a 45% margin is healthy for the stage, but against a 70% software benchmark it gets flagged. The same thing happens in defense, climate tech, robotics and biotech. One scorecard for everything is how good companies get killed on paper.
Open any startup scoring tool and run an evaluation. The scorecard will ask about recurring revenue, growth rate, margins and how fast the company is acquiring customers, and how quickly those customers pay for themselves.
These are software metrics, and they make sense for software companies. The problem is that most tools apply them to everything. A biotech company, a defense startup, and a climate tech company. Even to a robotics company manufacturing autonomous systems. All are scored on the same scorecard, against the same benchmarks, on the same timeline.
Strong companies end up looking weak, promising companies look broken, and the scorecard quietly makes the decision before anyone reads the report.
Not every startup is a software company
A software startup at seed is expected to show early revenue. Below a certain threshold, the score drops. This makes sense because a software product can launch and start selling within months.
A defense startup at seed is not expected to show revenue at all. What matters is how far the technology has progressed from concept to working prototype. A defense company with a validated prototype and no revenue is performing well. Score it on software benchmarks and it looks like it has failed.
A climate tech startup is measured on whether it can produce energy or reduce emissions at a cost that competes with what already exists. A hardware company is judged on whether its production costs are going down with each unit. A biotech startup might have no revenue, no product, and no customers, because the product requires years of trials and regulatory approval before it can be sold. What matters is the science, the regulatory path, and the intellectual property. None of that shows up on a software scorecard.
Healthtech is one example of a much bigger problem
Take healthtech. It is one of the clearest cases because the differences from software are so visible. Software expects revenue within 12 to 18 months. Regulatory review for medical devices averages 163 days for routine submissions and exceeded 1,000 days for complex approvals in 2023. Clinical trials can cost $40,000 per day. The median healthtech company takes 10 to 11 years to reach significant scale, three to four years longer than software. A healthtech company without revenue at 18 months is often right on track. The product simply cannot ship until the regulatory process clears.
The margin pattern is just as different. Software margins start high and stay high. Healthtech margins start low, around 25% at early revenue, and climb to above 60% only at scale. That is the opposite curve. A healthtech company reporting 45% margin is healthy for its stage. Score it against a software benchmark of 70% and it gets flagged. The flag is wrong.
But healthtech is just one example. The same mismatch shows up in defense, climate tech, robotics, hardware, biotech, agritech, and every other vertical that does not follow the software playbook. The specifics are different in each case, but the pattern is the same: one scorecard applied to a company it was never designed for, producing a score that looks precise but means nothing.
The real problem
The evaluator did nothing wrong. The tool hands everyone the same scorecard. When there is not enough time to build a custom one, the scorecard decides. And when the scorecard was built for software but the company in front of you is something else entirely, the decision it makes is predictably wrong.
It penalizes companies for not having revenue fast enough, even when the product cannot be sold yet. It flags margins as too low, even when they are strong for the sector. It measures the wrong things at the wrong time. And because the output looks clean and the math is consistent, nobody questions it.
Kuanta evaluates startups with a separate framework for each sector, 645+ scoring criteria in total. A defense startup is scored on defense metrics. A climate company on climate metrics. A biotech company on biotech metrics. We built it this way because one scorecard for everything is how good companies get killed on paper.
Bessemer Venture Partners, How to Scale Health Tech to $100M ARR · Bessemer Venture Partners, State of Health Tech 2024 · Rock Health, 2025 Year-End Digital Health Funding · Epstein Becker Green, FDA Review Time for 510(k)s · MedTech Dive / BTIG, PMA Waits Hit Record High · Applied Clinical Trials / Tufts CSDD, Clinical Trial Daily Costs · Eagle Rock CFO, Gross Margin Benchmarks 2025-2026
Kuanta Intelligence Team
Published on Jul 30, 2026 · Updated September 2026 · Part of the Kuanta Research & Venture Decision Science series.